Advice Line with Jonathan Neman of Sweetgreen

Transcript from https://podmenti.com/t/c955686970b45f4f



Hello and welcome to the advice line on how I built this lab.
I'm Guy Roz. This is the place where we help try to solve your business challenges, and each week.
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Alright, let's go.
Joining me this week is Jonathan Neiman. He's the co-founder of Sweet Green. Jonathan, it's great to have you back on the show. Guy, it's great to be here with you.
So you were first on the show back in twenty twenty. I think you were my last in-person interview before COVID, and it was crazy. It was like a week later. And for anyone listening, if you haven't heard that story, we will put a link in the episode description of this episode, and it's well worth
Going back and listening to it, it is such a cool story.
Um you guys started Sweetering in two thousand seven. You started with your friends Nicholas Jamay and Nathaniel Rou.
And you guys opened it a a salad shack in Georgetown in Washington, D C. You guys were students there.
I knew the location well. I used to live there.
Since then you guys have grown into a
A huge national
chain of of almost two hundred and fifty stores all over the US.
And I think uh just about a year, Jonathan, after your episode aired
This is in November of twenty twenty one.
Uh, you guys went public and you're you are now the CEO of a publicly traded company valued at uh around three billion dollars, which is just incredible. What ride.
Well, thank you. I'll I'll first of all never forget that day recording with you,'cause it must have been exactly five years ago, almost to the day,'cause
We f when we flew up in the morning everything was
Fine. And I remember landing in San Francisco and getting a call from a board member, Steve Case, and he's like, Are you ready for what's about to happen? I'm like, Is this really that big of a deal? We recorded, we left, and within hours, you know, the news started coming out. And so
It's been it's been quite a wild ride the past five years. And so much was happening. Like you guys were going through all kinds of
changes with the business, I think your entire like corporate team
turned over and you had to kinda start again and
amazing things that have happened and amazing innovations which I want to ask you about.
But before I do, I wanna ask you some f first of all, give me the a quick update of where we are now. I mean, a lot of people have heard your episode of How I Built This A lot of people have eaten a sweet cream.
I know it well. I have my go to
I love the lemon juice, olive oil, salt and pepper. That's my thing. I love it. Very healthy. Tell me a little bit about
where you guys are right now and just a g kind of a taste of where you're headed.
Absolutely. So today Sweet Green has two hundred and fifty locations around the country. We're now in twenty two states.
And since we last spoke, a few things we've been focused on. One has been a broadening of our menu.
So while we started as more of a salad shop, our vision was always more around connecting people to real food and leveraging the supply chain we had built and the scratch cooking and more the ethos and the brand to go beyond just salads. So over the past couple of years, we've introduced protein plates.
We've introduced s caramelized garlic steak.
We had a huge launch introducing ripple fries.
Ripple fries. Yeah. These are air fried French fries. Exactly. Sweet greens to take on the classic French fries.
Only five ingredients air fried.
No seed oils, cooked in avocado oil.
Just about transparent ingredients, cooked great quality food cooked simply.
And the the vision is to redefine fast foods. It's kind of this idea of you can have your cake and eat it too. There's a permissible indulgence.
So one has been this menu expansion and broadening.
Obviously we've been opening a lot of restaurants.
And then
There's been a a new innovation that we've been working on, which is called our infinite kitchen.
We've always been, you know, huge innovators in technology, thinking about ways to leverage technology to improve the experience for customers and team members.
And the Infinite Kitchen is our newest way of doing that. It is an automated assembly line.
So the way it works is you still put in your order, we still scratch cook and prep and cook, you know, make everything from scratch.
But the actual bull is now assembled by a machine.
By robot. By like by a hand? It's not a hand. It looks more like
A giant
kind of mainframe of like giant like refrigerators. They're clear tubes where you can see the food and there's a track underneath it. Oh wow. And it shoots out like lettuce or shoots out the cabbage or that's exactly right. And every single dispenser had to be engineered for that ingredient. I bet.
Yeah. So to get the perfect
dispense, the right you know, thinking about the different viscosity levels of different dressings and different items. And you gotta make sure it doesn't get blocked up.
Yeah. Like kale.
Exactly. If if everything was it was as easy as almonds, this would have been an easy exercise. Right.
But you have to make it so that it plates perfectly. It doesn't all sit on top of each other. So you know the bowl, you know, spins around. And customers are loving it. We can do five hundred bowls an hour, perfect consistency. The food quality is better.
We're seeing great results from a business perspective as well as you know, we're able to run the stores with significantly less labor and and I think a better quality job for our team members. So how many of these locations do you have now?
We have twelve open today.
And this year we'll open at least twenty to twenty five new ones.
So is the experien it's interesting because we had Steve Ells of Chipotle on a year or so ago and he talked about trying to do an automated concept to New York, which he I think they they are doing. I don't know where it is now, but
When you go into one of these stores
Are you ordering from a human or do you order from a screen?
So you have the option of ordering from a human.
that has kind of a mobile tablet where they can take your order. Okay, and they're walking around, they can go up to you. That's exactly right. So we've w the the idea, the vision for this is actually to give more hospitality and more service. So we save some labor on the menial task.
So we can lean in to the
to the more of the service side of the business.
We also do have kiosks and you can order on your phone. So we have those options available for you.
Um, but the I again the idea is how do we make it feel more human, more theater, more soul.
And the technology just be an enabler to that experience. Compared to a uh let's say a non automated store, how many
people do you need to run the automated store.
So it it like like all of our stores, it depends on the time of day. You know, a peak lunch in a New York store is much more than an average store, for example.
But on on average
Thirty to fifty percent less labor.
Wow.
at the store level. So you're running it with far f you know, far fewer people
But what's interesting is our turnover, our employee tur turnover is a really critical metric for us because the the the more we can hold our team,
the more productive they are, the more they know their customers, everything kind of starts from there.
the turnover in the stores with the infinite kitchen is significantly less than our classic stores. So it's less stress.
less stress. It's a little bit it's an easier job to work in.
Jonathan, before we get to our callers, I I'm curious. When you started Sweet Green, you had that location in Georgetown, it was the three of you running it, and then you had more a couple more people in, but you had a really clear vision. Like the dorm food sucked.
you wanted really great healthy food. And I remember
going to, you know, those restaurants in the early days and
But they've evolved over time, two hundred and fifty locations, even though their corporate

It does become harder to
maintain the culture, maintain the quality, maintain the commitment by the staff. It's very, very rare.
When you go to
a chain of restaurants and they are all entirely consistent, you know. Um I think In and Out is an example of a brand that does it very well. I don't know how they do it.
How do you make sure that
They are
Oh
operating at the same level.
Yeah.
So you're asking the the billion or maybe the trillion dollar question,'cause that is the business of restaurants.
I think the you know, the way we think about it is
in a balance of art and science.
The science is all of the tools. How do we make it really easy for you?
to to do your job, whether it be
You know software in the back of house.
or t helping you or you know, AI to help you order the right amount of food, or we're now leveraging AI to schedule labor, kinda make some of the routine things easy for you.
But the art is really, really important. The art is leadership.
And the most important position, it's sweet green.
is the general manager of a restaurant. We call them the head coach.
And one of the critical metrics we track is our stability at the head coach l level. We know if a head we can get a head coach to
Stay in their store.
For a few years.
everything gets more consistent and all the numbers get better.
So really figuring out what's the right profile for a sweet green employee.
And the amazing thing about the restaurant industry is it's one of those places that with not a lot of experience or education, you can start here as a you know, work in the line.
And if you work hard, you can be a manager making over a hundred thousand dollars a year in less than three years.
And
For us, those are our best managers. Our best managers were promoted from within. They're the ones that preserve the culture and understood the business kind of from the front line. Yeah.
Jonathan, why don't we take some calls'cause I know people are
are super excited to have you on and to get your advice. So why don't we go ahead and take our first call
Welcome to the advice line.
You're on with me and Jonathan Neiman from Sweet Green. Um, please tell us your name, where you're calling from, and just a little bit about your business.
Hello, guy, hello, Jonathan. My name is Dini Macala, амосоррутія.
I own a small pie company called Dean's Divine Pies in Rockville, Maryland.
And we make all of our pies in small batches, handmade, using simple ingredients, all butter crusts, and a whole lot of love.
So that's
The ethos of this company. Cool. And is it like tell me I mean
What kind of pies?
I really like to draw on my own.
background. I'm half Mexican, half Irish American, and so right now we're working on some
uh Irish inspired recipes. Other times I um putting together, you know, I have like a mixed berry made with mezcal, for example. Um so I really like to play with my my background, but also to be very creative with the recipes.
And how long has the business been around?
So it started during the pandemic. I um was actually recently divorced. I was dating my former yoga teacher and he really liked
Key lime pies, so I made him one for his birthday that year. That was October of twenty twenty one.
And uh, you know you do crazy things for love. So I I just busted out the best key lime pie I could
imagine. I've never made you know, I'm not a baker. I didn't grow up baking or anything like that. So
Anyway, he said, This is the best key lime pie I've ever had in my life. Uh there's a market for this. I'm gonna prove it to you. So he took it to work the next day.
And then that
you know, f fall, basically fall and winter people were
asking me to make not only the key lime pie, but then they'd say, Well that was so great, can you make
You know a strawberry pie, can you make a whatever
I um having never
Been a chef or anything like that, I
learned a lot on YouTube. I read a lot.
And
Figured it out and um and lo and behold, you know, now three years later I have
A really thriving small business. I quit my job. I'm a lawyer. Uh I'm a public interest attorney. I uh resigned last spring and I'm all in. So I'm reluctant to ask this because I'm imagining the Andy McDowell, Hugh Grant movie version of the story. What happened to the yoga instructor boyfriend?
It's that's a it's a great question, actually. Um, you know, he moved away. He he made some choices and he inspired the business. And I had this amazing thing and you know, it's
It's all good.
It's all good. We can still make a movie out of it.
Yes. Um Jonathan Neiman um
First of all, questions uh for Deanie.
Where are you selling the pies?
I I'm I have a small little brick and mortar that's in uh not a really great
strip mall and I'm doing all of my production out of a gorgeous huge commercial kitchen where I am right now.
But I see that I need to pivot and really think about
If I'm going to scale up.
the way that I am, I have to diversify, I think, my revenue streams.
And so
I'm pivoting away from the retail.
And focusing more on wholesale and pop ups and I'm on DoorDash as of last week.
Part of what happened in the beginning was that I wanted I I was baking out of my house. So I approached a winery and they said, Hey, you know, bring us
five pies of your favorites and you know, we'll try them and no promises. So I did that and they said you're on the schedule for Mother's Day. That that was twenty twenty two.
And they said you're gonna need to be licensed and shared and be prepared to, you know, serve pie to five hundred people.

Having you know again, I
I
figured it out. I found a c shared commercial s kitchen space and
Squeezed a lot of key lime and rolled out a lot of dough by hand and peeled apples by hand and was incredible.
Before we forget, you brought a question for for us. What do you need help with?
So well, I mean, what's very important to me in all of this is that it the company retains its heart and soul.
I think part of why it
has taken on a life of its own is because there's something about these pies that make people joyful.
I've made so many friends, I've gotten to know customers who have now become very good friends.
It's kind of like a little neighborhood hub in a big city.
Assuming that I can scale this up and I have some conversations actually this week that are happening with a major national
Uh food chain.
And they're already asking me questions about well, are you willing to change a name? Are you willing to change a logo and things like that.
Jonathan, I wanna bring you in here because you have two hundred fifty locations and we talked about maintaining, you know, uh brand and and quality and
I think that sweet green's done a great job at it. Obviously, uh Deanny's in a different spot, but as she thinks about growing and expanding
How r how can she keep the ethos, that kind of home spun feeling
With a brand that might
You know, selling
a dozen or two dozen different places.
You know, I I really think it starts with
the ultimate vision you have and what what your goals are and what what's gonna make you happy.
'Cause it's w from the way I hear about it, so much of it is about
The love you put into it and the connection
To your customers.
And
Scale will change that.
Your business will change. You won't
You know, I I mean I'm in restaurants a lot and I meet my customers, but it's not the same as when I was working
In the first store.
And I knew all the customers. And I remember, you know, my CFO tells this story. He joined us exact almost exactly 10 years ago. And he's like, you know, these guys had a really beautiful business.
They almost owned all of it.
And they could have slowly opened a store a year and owned all of it and had full control of this high quality experience.
But that wasn't the vision. The vision was
We want to be the next version of McDonald's.
So we we had we built it to be that.
It was never built to get to two fifty, it was built to get to three thousand.
I think you have to kind of think.
Think about it.
What is like is that what you want? Or do you really want to have
V known for the best pies that are really high priced.
with great margins and you're sold in the best restaurants in the world.
And you're on Goldbelly.
And your better your key lime pie is known to be better than Joe Stone Crab.
And
Like that's what's gonna bring you joy. You're still actually baking the food. So I think you just I think where some people get stuck is they think bigger is better.
Yeah.
And it's not always better because you're gonna actually to get big, you have to go through years and years of
Less profit.
I have friends today that have like a really nice
Businesses that they own a hundred percent of, don't have investors, do what they love and make really, really good money. Right. Oftentimes they make more money than than people who says they're doing tens of millions of dollars that aren't profitable. Look, y Deanie, the question is like again, to Jonathan's point here.
Do you want to put resources and time?
in trying to get into
uh stores and and and see if if
You know, this can really
Uh drive.
business directly back to your business or do you want to focus on
creating a premium product.
that people will line up and pay for? And and it's a it's a important question to ask yourself because
You could
Charge a premium price for what you're making. You're using high quality ingredients, it's all handmade, it's really special and local. I mean I
There's a uh a a pizza place I used to go to in Berkeley.
And the guy only opened from five PM to eight PM and you had to
Uh order it and Venmo the guy. It's it's a f well known place. I think it's called Amelia's Pizza and
It is amazing pizza and he sells out every single day. He's only open four days a week.
You know, and he controls his schedule, he controls his lifestyle.
You're probably spending a lot of your time now baking, right, I imagine?
Uh I mean I spend my time doing all of it. So it's you know, I'm doing the social media the b uh everything.
Right now.
Um, and that's something as I'm growing I have to
Figure out how to
you know, manage. But I do bake, but I do have, you know, my uh I have two chefs.
who are part time and that's made a huge difference because I can just give them the recipes and they're off and running and I can
You know, go
Try to, you know.
talk with people about wholesale opportunities or work on the social media stuff.
Yeah, I mean, Jonathan, I mean I think it's a natural human instinct, right, to want to expand.
Right. And a as you did, as m as our show has. Everybody wants to do that. And I think there are

If you were in Deanny's position here.
And you're thinking about okay, how do we take
This from the
Shopin Rockville, farmers markets.
to at least a r bigger regional presence.
What do you think
are interesting options for her.
I I am actually very bullish on
on brick and mortar right now.
I think that in this world and you said of
Kind of everything digitized.
I we're seeing a lot of energy around the analog experience again and the power of building community in a physical space.
You know, I g I'll give you an example in our business.
When delivery became a thing.
We're like
Oh, maybe we don't need restaurants.
Because
People know the brand, we can open these kind of ghost kitchens.
And we can just
Deliver.
to people through either our app or all these other uh all the all the marketplaces.
Well what's interesting is
I can have delivery coverage in an area.
And then I can open a restaurant there.
And
The whole thing lives. So the physical presence of an actual
A place
actually can help lift your wholesale and the rest of the business. You have to make sure you can afford it and build it out and all of that.
Um and with real estate, I'll say real estate markets are relatively efficient when rent is really, really cheap.
There might be a reason it's really cheap and that the old adage of location, location, location.
It's means something. It's real. Like even today, a brand like Sweet Green, big we can market, we could have all of this capabilities.
If we take a bad location.
It doesn't work.
Right.
You know, I just had an idea, Dean, which is
You know, especially in where you are, it's all over the country, right? There are often
incentives to bring local businesses to a new development, right? Like
I I think uh here in the Bay Area there was there's a famous fried chicken place in in Oakland called Bakesale Betty's and then when the Chase Center where the the Golden State Warriors play opened up, they invited them to open a location there because it's local. It's you know you go to the San Francisco Airport
And there are all these local restaurants there with locations there. And I I imagine that
To Jonathan's point, this idea of authenticity of analog experience, like I think that's so
True. I'm seeing it anecdotally and I'm sure the
Data's gonna back this up soon.
Which is a brand like yours, which is
It's rooted in Rockville. It's rooted in the Maryland, Virginia area.
I bet that there might be opportunities to partner with
You know, somebody who's building some kind of
you know, new development or maybe a food hall or something where
your presence will be really welcome because you are local. And I I don't know exactly
What's available, but there might be something out there.
I love that idea, guy. I you know you've probably been to Union Market.
Yeah, exactly. Like a union marketing. Union market would be like a perfect place for that.
And then you could you have the disku the people that go there are looking for those cool those sorts of things.
Um it will can also
you know, function as your bakery. So instead of the rent space you're renting there, but then you have a physical presence for discovery.
So I I li I really like that idea. Yeah, I I I think there's a lot of cool opportunities.
Deen good luck. Thank you. The the the company's called Deeny's Divine Pies. We will we're cheering you on. Thank you. And uh we'll we'll keep tabs on you.
Thank you very much. It's so nice to meet you both. Thank you. Best of luck, Deanie. Great to meet you.
Yeah, I mean I feel like especially with a business like this where people are willing to pay more for like when you're seeing the people actually made it.
And you can talk to them and it's a sense it's like wine, there's like a terroir, like you're you're you're tasting a sense of the place.
In this case, Rockville, Maryland.
Yeah. And you know what I mean? So I I feel like there's something there about
a willingness to pay more
For something that you can really connect with.
Absolutely. And I also think you've you've probably heard of the the Japanese term Ikagai.
Yeah.
it it it also matters, you know, what what are you uniquely good at? What do you and love to do and what what can you be the best in the world at and make money and you gotta find that intersection. So
from what I heard from D you know, from Dini is she loved that the actual hands on piece of it and that connection and
scale may come at odds with that and there's a way to have a very successful business.
And brand and keep it
tight still and and do the things you love.
We're gonna take a quick break, but when we come back, another caller, another question, and another round of advice. I'm Guy Roz, and we're answering your questions right here on the advice line on how I built this lab.
Welcome back to the advice line on how I built this lab. I'm Guy Roz, and my guest today is Sweet Green co-founder Jonathan Neiman. Jonathan, let's uh let's take another call. Let's do it. Alright, let's bring in our next caller.
Welcome to the advice line. You are on with Jonathan Neiman, co-founder of Sweet Green. Welcome. Please tell us your name, uh, where you're calling from, and a little bit about your business.
Yeah, how's it going, guys? Um, well, Guy and Jonathan. My name's Matt Pinstin. I'm calling from Glosser, Massachusetts.
And I am the founder of Underground Mushroom Co.
Um I produce gourmet mushrooms for local farmers markets.
at home deliveries and restaurants in the area.
Nice. Well welcome to the show. Thank you for calling in. So you
You've got a business, you're growing mushrooms. Where are you growing the mushrooms? And'cause Gloucester is a I don't e I don't know about mushroom cultivation. I mean I I eat them, but I think Gloucester's pretty cold for a bun like a big part of the year. So I'm assuming it's like indoors, like heat lamps kinda like sound like you're growing something dodgy, but is that right?
Yeah, so so the name Underground Mushroom Co., my intention was to start in a basement just for that very reason. Less fluctuation of temperature.
And um consistency is really the name of the game when you're growing mushrooms. They like about sixty-three degrees.
And uh I figured the heating and cooling throughout the year would would be more advantageous in a basement. So that's where I started. You are growing in a basement. I am, yeah. And and you know, as far as retail space is concerned, uh
You get cheap rent.
Right. Yeah. I rent uh two thousand square feet of commercial basement space. It used to be a lobster pound, so they used to wholesale lobsters out of there. And I took one of the lobster pools and converted it into a
Mushroom Girl Rome.
Oh wow.
So it's a twelve by twenty foot space and it allows me to grow anywhere between a hundred and fifty to three hundred pounds of mushrooms a week.
Wow, what's your rent like there?
Oh, it's like sixteen hundred bucks a month. Oh, so it's nothing.
It's super cheap, yeah. Um I mean one of the things is uh
During king tides.
I've been told that it floods. I mean there was flood damage in the space, but I saw that and I'm like, what a great place to get my feet wet.
Yeah, exactly. And and what so how do you make sure that the mushrooms don't get flooded out if if there's king tides?
Well, I haven't run into that problem yet. I mean, that's probably the impetus to move to my next space with this space right now.
is kind of a proof of concept, but I've already become profitable.
And uh I love what I do, so I just want to take this to the next level.
What are you doing in in sales right now?
So
The cost of production is actually pretty cheap. I can produce one of these substrate blocks for only six dollars and I'm getting
About uh
forty dollar return on that uh
Investment. How many mushrooms in a block?
It's about two and a half.
pounds of mushrooms per block.
And you know, not only is it the cultivation of mushrooms, but I actually sell at home grow kits that I can ship
Anywhere throughout the country.
I also do tinctures that I sell at farmers markets and um
Yeah, I absolutely product. Are you turning it into is it more functional mushrooms like the lion's mane, ashwagandha, those sorts of things? Or is it
Tell me a little bit more how it shows up for the consumer. Yeah, less of that, more of just the gourmet angle. Oh gourmet. Okay, gourmet mushrooms. Yeah, yeah. I studied uh sustainable food systems in college
and worked on farms and I got into mushrooms primarily.
Because it's the most sustainable food out there. I mm because they're decomposers.
They take
sawdust which otherwise would be wasted.
and creates a viable healthy food source.
Wow. So you're so you're selling at restaurants mainly?
Yeah, yeah. Uh high end restaurants in the area.
So the idea is to create a I'm thinking here in LA, for example, we have a famous farmer named
Alex Weiser. It's like you wanna be that
The guy known where the best restaurants are serving your mushrooms and they're putting
your name on the mushroom.
On the menu. They're putting your mushroom name on the menu as a selling point. Yeah, you you got it. I mean, I get a real thrill from seeing my name on a menu and
The way that I
go about selling these mushrooms, I really just knock on the back door of restaurants and I get a real kick out of talking with chefs and and explaining
you know, different recipes that they can incorporate my ingredients into.
And you said you you're at the farmers' markets as well?
Yeah, I am. And and I'm a one man show right now, so
I haven't uh
hired anybody, but um I'm able to hold it down, all the spinning plates I can I can do myself. Before I forget, what question do you need help with?
What's your question for us?
Yeah, so the so the question has to do with
Scaling but but not just scaling to scale. I think one of the
Ways that a lot of people
fail in this industry is that they grow too big.
Mm. Too quickly.
mushrooms have a limited shelf life.
And yeah, as a as a result, I would rather people
start finding me through virtuous food choices.
So
I was wondering, you know, since sweet green
really prides themselves on on people making healthy food choices.
Um
How do you go about that? How do you how do you shift?
uh people's perception of
choices they make and and what you're putting out.
You know.
It's interesting because you know, well, sweet green when we started the business was very much positioned around healthy, you know, around the fact that it's healthy and that's still a core part of the brand.
What we've learned is
Well a lot of people say they care about health.
When it comes down to making a decision about what they're gonna eat.
It's taste, convenience, and value.
Your health is kind of there, right, you know, right in the number four range.
And so where we've shifted a lot of what we talk about, and I think this is gonna be very true for you, is all the things that we do.
around our supply chain and are made from scratch.
Is really
To make it taste better.
And yes, it happens to be really good for you and good for the environment.
But in terms of like it what we're trying to kind of position more so is we do this because it creates better flavor.
And I think for you that's super true. And I think that's that's why, for example
We do these partnerships with these chefs.
Sounds like you're already on it.
To kind of be the mushroom farmer to the greatest chefs. Yeah.
And I think if you do that for a little while, you will build an amazing brand. And the second thing I would do is figure out how to
Build a little bit of a brand around yourself.
You know, I look how do you become kinda like what Joel Salatin was or what Al Weiser is? Kinda you become a little bit of a
Fame is Farmer. If I don't know if you've seen Farmer TikTok.
There's a lot of cool stuff going on. And I think if you could go just really authentic, here's how we do it, on you know, and kind of
Honestly, I you know, there's a lot of people that talk that there's no brands anymore, it's just really people.
Right. And it sounds like, you know, given your education background and what you're doing, if you can take people behind the scenes on how you do these things.
Kind of show them your personality.
I think that plus the positioning with chefs and then being at the farmers market, I I I think is a really kinda cool winning combination.
Yeah, thanks, Jonathan.
What are your constraints, Matt? I mean, it seems like the business is you don't need a whole lot of money.
to grow, it seems that the cash flow can kind of
help you fuel the growth of the business. Is that true? Do you have any
Are there already?
Resource.
Um
Yeah, I mean I I raised fifty thousand dollars initially through a company called May Invest. Um it's like a crowdfunding
Not like um a GoFundMe, but there is a rate of return that my investors are expecting. I got a hundred and six.
Investors. Mainvest I think went out of a business, right? That's correct. Yeah. So th now it's on me to
You know, allocate those funds back to my investors and I'm not to the point the platform was doing it for you, but now they're not doing it. Correct. So I have to find another platform when I get to that point. But but um
You know, between
Yeah.
All all my expenses and and trying to keep myself uh
f afloat. I I've yet to be able to
uh pay back my investors, but I mean that's the next hurdle, that's the next goal.
And and you know it
I don't know.
If it would be
foolish for me to go out and do a second round of investing, having not
You know.
Started.
paying back my initial investors.
But um
You know, that would certainly speed things up getting into a second location.
Are you supply constrained or is it
Is like if you had more supply you'd be selling?
Oh yeah.
So certainly.
I mean I'm s I'm selling out uh everything I produce.
Wow. Um that's a good that's a great sign. Yes. I d absolutely. Yeah. So so here I've I've survived the winter.
We're coming into the spring.
Tourism's coming back to Gloucester, Salem, Beverly, the whole area.
And I just bought a second sterilizer, so I'm gonna be doubling my output.
And um, you know, that'll that'll free up some cash and and hopefully I'll be able to hire someone to help me, but money helps everything, right? So
Yeah, I could certainly expand with with
added uh capital.
Well, it seems like you have some really interesting opportunities, especially now that I mean you're s you're selling everything you can grow, which which is a good sign. It means that you have to figure it out, right? You gotta figure out a way to
expand your footprint and whether you can do that through cash flow or whether you're gonna take a loan out. I mean it's possible you might be able to get an SBA loan.
Uh
And that could be another uh interesting interesting way to go. But um
I mean it's a great sign. It it means that you're producing something that people want.
You might have some pricing power.
Yes.
Yeah.
I do sell my product for three, four dollars over what?
distributors are selling theirs for, but it's because the quality of my product, my chefs want to purchase something local. And you know, I'm nervous right now. I can hear it in my own voice. But like when I'm face to face with a chef, um, they trust me and and want what I have to sell. So
Not only can I grow them, I can sell them and and I
Take that as a point of pride.
Yeah.
That's awesome.
Matt, good luck then. The business called Underground Mushroom Co. Company Co.
Yeah. Congrats. Good luck. Congrats, Matt. Can't we turn it on? Thanks so much, guys. Yeah. Pleasure chatting with you. Take care. Thank you. Yep. Bye bye.
I just now do growth mushrooms tonight. I'm gonna do some sauteed mushrooms.
You could take a portabella and turn it's like a burger.
So good. So good for you. I mean it's an amaz amazing, amazing planet.
Alright, we're gonna take another quick break, but we'll be right back with one more caller. Stay with us, I'm Guy Raz, and you're listening to the advice line right here on how I built this lab.
Welcome back to the advice line on how I built this lab. I'm Guy Raz, and today I'm taking your calls with Jonathan Neiman, co-founder of Sweet Green. Uh so Jonathan, let's get back into it and take another call.
Awesome.
Hello, welcome to the advice line you're on with Jonathan Neiman.
Of sweet green, welcome to the show.
Please tell us your name.
Uh, where you're calling from and a little bit about your business.
Hi Guy, hi Jonathan. Uh my name's Jewey Cornell. I'm calling from Villa Park, Illinois.
My business is Dak Dak Wings and we specialize in crispy double fried wings, fresh cut fries.
And uh unique house made sauces.
Yum, awesome. Welcome to the show, Joey. And where is DakDAC?
Wings located?
Yeah, so we currently have one uh brick and mortar location about ten miles outside of Chicago in Villa Park, Illinois.
And it's a late night place, open like super late night, or what what are your hours?
Yeah, so we're lunch and dinner, um
Mostly and were open
For the suburbs fairly late, ten PM on weekdays and Fridays and Saturdays till eleven PM.
And you've got a brick and mortar. And tell me a little bit about how you
Give me some backgro are you a chef, or is that your background? Are you a cook? Did you work in restaurants? How did you how did you start this?
Uh so I got super involved with our high school's culinary program
When I was about fifteen years old.
And I just dove into it and uh
So on top of spending
all the time I could in the culinary department. I was working at a local restaurant.
And kind of in tandem was doing cooking competitions and
you know, some illegal catering perhaps for uh
people in my community, but uh
quickly decided to go to culinary slash hospitality school. So I
briefly attended Johnston, Wales in Providence, Rhode Island. Cul there's culinary school there, yeah. Yep. Yeah, I thought to meet like minded people is a good place to go.
Uh so I was working full time and I tried Korean style
wings for the first time.
and was blown away with the texture. It's uniquely crispy, sticky.
Uh
the chicken is mildly flavored versus being heavily seasoned and you're
It's just a
Amazing experience.
And then when the pandemic hit
I came back.
home to uh
The Ville Park area.
And was upset that we didn't have anything uh
close to it for wings. So
Yeah, started writing a business plan and looking at spaces to lease. Um
Finally after about touring seventy locations, I was trying to keep it small, takeout only.
you know, almost a covet proof concept.
And I found a former little Caesars that I was able to
retrofit into what I've envisioned and
Yeah, just with my own cash and I was able to get a
A small SBA loan and that's uh what started our restaurant. Wow.
How did you get the cash to do it? I'm just I'm asking for a friend, people listening. How did you get the cash? No, for sure. Um, believe it or not, guy, when I wasn't recipe testing or
Working on the business plan. I was driving Uber Eats and DoorDash. Nice. Um That's how you save the money?
Yeah, when it and when people were at home
The roads were clear. I was driving a little fast, trying to go from order to order and uh
That's how I save most of the money. It's a great story and you probably learned a little bit about part of your business.
Thank you, Jonathan. Yeah.
H how much did you save from Uber and DoorDash? It ended up being close to fifty fifty thousand. Amazing. Yeah, so I was able to then get a
S VA loan for a little more than that and
When I say, you know, opening a restaurant on a sh shoestring trust plus building out everything, you know, a website, online ordering
That's about as tight as you can do uh a restaurant for
most people I talk to say, you know, a restaurant of similar size is three to five hundred thousand. I can I can attest to that. That is Yeah. I uh we made it work and
Came close to running out of cash, but here we stand today almost uh three years, a little over three years later. So
Wow.
And tell tell us about what's your challenge. What's your question for us?
Uh yeah, so the question that I had um with future restaurant
Expansion in mind.
How much should I focus on our primary product of
crispy wings and fresh cut fries.
And how much should I lean into potentially leaning into trends?
Uh, whether that's frying in beef tallow, offering a chicken sandwich, chicken tenders
Excetera.
Interesting.
Interesting.
I think it starts where where I was gonna ask you is
understanding who your customer is and a little bit on what the where the brand is positioned. Is it positioned
kind of trying to compete with Wingstop, trying to be
a healthier, more premium version,'cause I think a lot of the way I'd answer some of those questions depends on
which part of the market you're trying to capture.
Yeah.
Definitely not healthier, sorry, Jonathan, with you know, uh
It's
Chicken wings and fried food in general is indulgent, so I kinda take the Todd Graves approach is that
The day someone wants a salad, they're gonna get a salad.
If someone wants, you know, fried chicken, they're gonna get that either way.
But with that said, the product is definitely
Uh
Premium we use all natural
you know, antibiotic free chicken.
um our coleslaw, our pickles, our sauces, everything we're making in house. So we're definitely chef driven.
Um, especially with one restaurant, it's definitely easier. I know that gets tougher.
Uh as you grow.
So yes, we are are slightly premium, uh, but
really with the focus on just a better
chicken wing experience in general.
The question to me is like
Could you offer a chicken sandwich? Could you offer a salad? And I what I wonder is
Is whether it
'Cause I think the answer is yes, but I don't think it's a yes and this is the way it is. To me it's more like a pop-up kind of approach. Like, hey
You know, there there's a great pizza place that I go to in in Sonoma County and
They do Roman style pizza, right?
But now and again they'll uh on their on their Instagram they're like hey we're doing New York style pizzas just today.
But it's a i the the place is a Roman style pizza. It's you know the big square
Dishes of pizza.
But on those days people get psyched because it's like something else that is just
New and different. And I wonder whether you could just try that pop up approach. Like
We're doing
Korean like boneless wing
Chicken Korean chicken sandwiches.
Definitely guys. So we've uh we've
had really
good success with LTOs, you know, limited time offerings that we've done.
Uh now with a decent sized email list.
Uh, we've done in the past chicken and waffles, chicken sandwiches, we even did a funnel cake and fried chicken special last summer.
And just like you say, you send out an email, put on Instagram.
And those always
go over incredibly well.
Um
But again, those are one time have to get it now, or it's or it's gone.
Of course.
those work well, but I guess um
to take a step to fulfill a new trend. Um, like Jonathan knows, if you add one menu item, it completely changes the flow of your line, your prep schedule.
uh walk and storage. These are things that
I like to have as tight of a menu as possible. We do one thing very well.
But sometimes in the back of my head I get, you know, the constant people saying
Oh, you should add a chicken sandwich. You should add tender. So we offer those as LTOs when we can.
But something like frying a beef tallow and eliminating seed oils.
We are actively trying to switch over to that.
Uh so
I guess just what way uh how do you know when to make those decisions? Do you trust your gut? Do you trust
Industry data. Yeah, it's a it's an interesting one'cause we're we've been going through this transition ourselves and evaluating the cost benefit of it.
My gut is to stay focused.
And stay focused on wings and be known for the best wings in the world.
Eventually you will
you know, as you grow, you'll want other growth levers.
And so keeping that for, you know, another day, I think is a good thing. I wouldn't go into it yet.
Wingstop didn't introduce sandwiches until like two years ago. And by the way, the reason they did it
Was not
from a customer perspective, it was from a supply chain perspective because they realized that
If they introduce sandwiches, now they can buy whole birds.
Instead of just buying the wings'cause there was such demand for the wings, and now they bought the whole birds and brought their costs.
Of o overall of all of their chicken down.
So I will say that
A lot of it, you know, I keep I keep going back to who's your core your target customer and where you're positioning the brand.
My view on health is health is less about
Calories. It's more about
the underlying ingredients not having processed stuff and
crap in it. So I think the way you're doing it
handmade, you know, no preservatives, no processing, and potentially removing seed oils could have a very cool positioning of a better for you wing.
But if you do that
Make sure the whole brand is aligned towards that.
And in terms of the s you know, the moving to beef tallow, I think it's really interesting. I'd evaluate what's the additional cost, how much more would you have to sell to fund it.
What I can tell you, and we've spoken about this publicly, is we did start a journey of removing seed oils about two years ago out of our restaurant, just introduced fries.
cooked in avocado oil and
Generally, I'd say it's been worth it. The response has been really good for our customer.
People did care and we saw a noticeable shift.
However, I will say that
We saw it very different by market.
So places like LA or New York reacted much more positively to it.
Than certain other cities. Again, this was about two years ago. I think the awareness has shifted.
A bit around seed oils, so
You know, speak to your customers. I I think that
Even today at our scale with millions of customers, I spend a lot of time talking directly to customers.
And I think at your scale.
I would just talk to him.
That's the beauty of kind of starting being small. Do you care about this? Would it make you want to come more?
Is it something that you would tell your friends about?
Um and that that'll help you get an e you know, kind of sharpen your gut feeling on what the right decision is.
Agreed. Agreed. Joy Cornell the
Business is called Dak Dak Korean Wings.
Good luck.
Keep it, man.
Thank you guys. Jonathan guys, uh it was a pleasure to be here. Thank you very much. Great to meet you, Joey. Good luck. Thanks for calling in.
Um Jonathan, before I I let you go, just a c a quick question. Now that you have all this experience, I mean two thousand seven, man, you were a baby. And I still think of you as a baby, but you're a grown grown up obviously today.
and and running a s really significant national
Yeah.
W if you could go back to to you in two thousand seven and just give you some encouragement or advice
Wha w what do you think you would say?
to him.
I'd probably say enjoy the journey.
That it will be
More challenging.
Than you expect, but more rewarding.
And the key is
Not giving up.
And
Don't
Take anything too seriously.
This too shall pass. You know, you think back on the all those existential moments.
You know, and I still we still have them today. I think I talked about this on your podcast. You know, one day you think you're on the verge of world domination, the the next on the verge of bankruptcy.
You know, you still feel that and you just gotta do your best to kind of
Maintain that equanimity.
Yeah, th th what's crazy when you think it's been eighteen years, it's been a
Half my life pretty much. Incredible.
So if you're not having fun while you're doing it, it may not be worth doing.
It's awesome. That's Sweet Green co founder and CEO Jonathan Neiman. Jonathan, thanks.
Guy, thanks so much for having me on. This is fun.
Uh, and by the way, if you haven't heard uh Jonathan's original how I built this episode, you've got to go back and check it out. We'll put a link to it in the podcast description. And here's one of my favorite moments.
from that interview.
you went to your executive team and you present this plan
And within a year, they all left.
Basically your entire
Top level execs are gone.
Yeah.
I remember like the last one where we thought it couldn't get any worse.
And I get the text from someone and it's always like the worst text when someone says
Hey, can you talk?
And then so the last person quits.
And we're just like, oh god.
What are we gonna do?
Hey, thanks so much for listening to the show this week. And by the way, please make sure to check out my newsletter. You can sign up for it for free at guyroz.com or on Substack.
And of course, if you're working on a business and you'd like to be on this show, send us a one-minute message that tells us a little bit about your business and the questions or issues you are currently facing, because we would love to try and help you solve them.
You can send us a voice memo at hid at id.wondery.com or call us at 1800-433-1298. You can leave a message there and make sure to tell us how to reach you. And by the way, we'll put all of this in the podcast description as well.
This episode was produced by Iman Maani with music composed by Ramteen Are Blui. It was edited by Casey Herman. Our audio engineer was Neil Rauch.
Our production team also includes Alex Chung, John Isabella, Elaine Coates, Chris Massini, Catherine Seifer, Carrie Thompson, Sam Paulson, JC Howard, and Neva Grant.
I'm Guy Raz and you've been listening to The Advice Line?
on how I built this lab.